A large Chinese city is mulling over a proposal to create a new type of anti-speculation system. Wuhan (never heard of it either) is currently taking feedback on a draft law to create a housing ticket system. If successful, all buyers would need approval from the Wuhan Housing Security and Management Bureau. The goal is to ration housing, and ensure speculators are identified and weeded out. Housing was declared a national priority, as the country focuses on productive growth. If this catches on, it could become more common in other large cities trying to cool home prices. At least in China.
Buying A Home In Wuhan? Ticket, Please
The draft proposal would see all prospective home buyers apply for a “room ticket,” required to buy a home. The ticket requires being vetted by the authority, and is only valid for 60 days after. After that, you need to apply again.
Home buyers who circumvent the system can land themselves in hot water. Families caught cheating will be banned from property purchasing for a year. They also land themselves on a “blacklist” of dishonest people. No ticket, no home.
One last interesting point here is they’re also targeting the real estate industry. Professionals such as developers and agents, would no longer be able to act as a proxy. Circumvention of the rules can land professionals an investigation, fine, and spot on the industry black list. Not sure what the last part includes, but I’m guessing it isn’t great for business.
Track, Trace, and Stop… Housing Speculators
The idea isn’t to stop home purchasing, but to limit and track the speculators. New home prices in Wuhan have shown annual growth of 7.3% as of May, shows National Bureau of Statistics (NBS) data. It might seem tame to some Western markets, but they’re trying to get ahead of the issue. It also happens to be a part of the country’s platform to promote real economic growth. That includes making home prices sustainable and preventing an overallocation of residential investment.
The housing ticket system appears to be new, but the concept of limiting one home per person at a time isn’t. Shanghai and Guangzhou have previously limited buyers to one home at a time. Though this appears to be a much more aggressive targeting to curb speculation.
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